Palace Capital plc
("Palace Capital" or the "Company")
PALACE CAPITAL SELLS LEEDS OFFICE BUILDING AT A 54% PREMIUM OVER BOOK VALUE
Palace Capital plc, the property investment company that focuses on commercial property outside London, today announces that the Company has sold its long leasehold interest in Warwick House, Wade Lane, Leeds to a private investment group for £2.15 million, £0.75 million above book value.
Warwick House was part of the Sequel Portfolio acquired from Quintain plc in October 2013. It comprises an office building with a net floor area of 14,800 sq ft and is held on a 125 year lease from Leeds City Council that commenced on 29 September 1980 at a minimum ground rent of £8,000 per annum or 12.12% of rents received, whichever is the greater.
The building is currently let to Interserve Working Futures Limited for a term expiring on 30 August 2019 at a current rental income of £196,250 per annum with tenant's options to break on 31 August 2017 and 31 August 2018. The current ground rent payable to Leeds City Council is £23,786 per annum so the net income received is £172,464 per annum.
Neil Sinclair, the Chief Executive of Palace Capital commented:
"This continues our policy of recycling our capital from properties where we believe there is little or no opportunity for growth. Warwick House is not only in a secondary office location but the tenant has a break option in August 2017 which, if exercised, would leave us with an empty property within 7 months. Effecting a sale of our long leasehold interest at 54% above book value is a great result as we continue to generate value for shareholders."
Date: 24 February 2017
For further information, contact:
Palace Capital plc
Neil Sinclair, Chief Executive
Stephen Silvester, Finance Director
Tel. +44 (0)20 3301 8331
Allenby Capital Limited (Nominated Adviser and Joint Broker)
Nick Naylor / James Reeve
Tel. +44 (0)20 3328 5656
Arden Partners plc (Joint Broker)
Chris Hardie / Ciaran Walsh
Tel. +44 (0)207 614 5917
Capital Access Group (Financial PR)
Scott Fulton / Jessica Bradford
Tel. +44 (0)20 3763 3400